Saudi King Salman opens coffers for masses
RIYADH: European leaders are still battling over austerity. The United States Congress is gearing up for another fight over the budget. But in Saudi Arabia, there are no such troubles when you are king — and you just dole out billions and billions of dollars to ordinary Saudis by royal decree.
Not surprisingly, Saudis are very happy with their new monarch, King Salman.
“It is party time for Saudi Arabia right now,” said John Sfakianakis, the Riyadh-based Middle East director of the Ashmore Group, an investment company, who estimates that the king’s post-coronation giveaway will ultimately cost more than $32 billion.
That is a lot of cash, more, for example, than the entire annual budget for Nigeria, which has Africa’s largest economy.
Since King Salman ascended the throne of this wealthy Arab kingdom last month, he has swiftly taken charge, abolishing government bodies and firing ministers. But no measure has caused as much buzz here as the giant payouts he ordered to a large chunk of the Saudi population.
These included grants to professional associations, literary and sports clubs; investments in water and electricity; and bonuses worth two months of salary to all government employees, soldiers, pensioners and students on government stipends at home and abroad. Some private companies followed suit with comparable bonuses for their Saudi employees, putting another few billion dollars into people’s pockets.
Some of the government spending will come over years, but most will hit the Saudi market this month, including the bonuses. About three million of Saudi Arabia’s 5.5 million-person work force are employed by the government, Mr. Sfakianakis said.
So, for the moment at least, there is little talk about human rights abuses or political reform. Saudis are spending. Some have treated themselves to new cellphones, handbags and trips abroad. They have paid off debts, given to charity and bought gold necklaces for their mothers. Some men have set aside money to marry a first, second or third wife. One was so pleased that he showered his infant son with crisp bills.
“The first thing I did was go and check my storerooms,” said Abdulrahman Alsanidi, who owns a camping supply store in Buraida, north of Riyadh. He expected a 30 percent jump in sales.
Saudi rulers have long used the wealth that comes from being the world’s top oil exporter to lavish benefits on their people, and many Saudis describe royal largess as part of a family-like social contract between rulers and loyal citizens.
But the new spending comes amid change and uncertainty for the kingdom. King Salman ascended the throne after the death of King Abdullah and announced the bonuses as a good-will gesture to his people.